Financial Retirement Planning

Tax Issues for Small Business

Tax Issues for Small BusinessTax issues for small business owners can take them away from focusing on their main business objectives. Small business owners risk heavy penalties and professional fees by mixing personal and business records, making it difficult for them and the government tax auditors to assess if there are any irregularities.

Combining personal and business accounts is one of the most costly mistakes many new business owners make – a mistake that can cost thousands in tax penalties and professional fees.

Business owners may find it easier to deposit checks to a personal bank account, or to charge business expenses to a personal credit card, these actions place them and their businesses at risk. Making mistakes regarding claiming personal vs. business expenses is a  mistake that can cost them thousands of dollars.

Keep a separate bank account and credit card for your business expenses and never mix the two. With separate accounts there is a record of all expenses, the date, the item purchased and how much was spent. Not room for confusion and errors to creep in.

A business is required by law to keep adequate and accurate records of all income and business expense.

Tax Issues for Small Business – Tips

  • Keep personal and business separate.
  • Have two separate bank accounts: a personal account and a business banking account.
  • Keep good records.
  • Seek expert advice. Include a business banker, tax and legal professionals.
  • Have an expert complete your taxes

If you are organized, keep excellent records and have a tax adviser complete your business income tax records, there is a lot less chance that the government tax people are going to start checking. Believe it or not, by being organized, you will also save time in the long run which means a whole lot frustration with your taxes, you will also have more time to spend on your business which is the main are you want to spend time on. Looking for missing receipts, miss-filed receipts and straightening out transactions regarding whether they should be charged to your business or personal expenses is not the best use of time. Keep your tax issues for small business to a minimum and focus your time on running your business.

(Visited 14 times, 1 visits today)

You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

AddThis Social Bookmark Button

Leave a Reply


Web Content Development